Theses on Work and Wealth Ruthless Criticism

Theses on work and wealth

[Full Text from Gegenstandpunkt: Work and Wealth]

Thesis 1:
Property means exclusion

In our society, everything one needs already exists. Only: the things one needs must be bought. They are always the property of someone else. If one can obtain the things one needs to live only by buying them, then one is fundamentally hindered from making use of them. Private property separates one from the vital necessities; this society is not based on supplying people with the things they need, but excluding people from them. This is a relationship based on force.

If people are excluded from the means of satisfying their needs by property, then the purpose of this society is not simply supplying people with what they need. They are separated from what they need. Rather, the purpose is a matter of everyone seeking to take advantage of this separation. The needs of others are the lever to do this.

Force is inherent in this form of wealth. This force is not historical, but is produced every day and maintained by the state guarantee of private property.

Thesis 2:
Property as money is the means to access social wealth

Things are produced in our society for sale. Things are produced as the property of individuals who do not need them and do not want to use them. They are produced solely for the goal of drawing money from other people’s wallets. If things are not turned into money, they are worthless – no matter how useful they may be. The value of property is not measured by its use in consumption, but only by money.

Conversely: one can access the things one needs only by buying them. Money is the means of access to social wealth. Money is the prerequisite for meeting any need. So one must make sure that one has money.

The benefit of work does not simply lie in the product that is produced, but in the money that it earns. The purpose of capitalist production is money. Because money has a limitless quality, its increase is limitless – and the work done money can never be enough.

Thesis 3:
Property is command over the work of others

Without money, no useful things. So everyone must make sure that they have money. Anyone who does not have the money he needs for his living expenses has only one way to get it: he must work for someone else. He is a worker.

The worker must find someone who has so much money that he does not need it for his own use, but can spend his money in order to make more money with it: an employer. He pays wages to the employee. The employer employs the employee only if – and as long as – the work is worthwhile for him and his property. For the employee, this means that he – and therefore his living expenses – depends on creating wealth for someone else with his labor. And given the need to provide for his living expenses, he does not have a choice whether he works or not.

On the side of the employer, if the work of the employee does not pay for itself, then he must adjust its cost or lay him off. And the only criterion for the wages and the working conditions is that the work is profitable for the employer – otherwise no employment takes place. This also means that the employee must subordinate his available time and sacrifice his health for the increase of somebody else’s property.

The amount of the property they own divides these two into different social types. One works and thereby produces another’s property and is dependent on this service to another’s property; the other owns the property on which the first is dependent and invests in order to increase his property.

The augmentation of the employer’s property results only from the work of the employee. The employer must invest his money in two “production factors.” On the one hand, he must buy means of production (machines, buildings, raw materials, etc.). This does not diminish his property; it only changes its form. The investment costs reappear in the product price. No increase in property occurs from this. On the other hand, the money he pays as wages to his employees is lost to him. But he thereby acquires the right to have them work for a certain time. Working conditions, types of work, time periods, and above all the results of work – the products of work – belong to the employer. This newly created property has increased only through the expenditure of labor. Labor is therefore the source of his property.

The employee gets nothing from this newly created property. It belongs to the employer who employed him and paid him a wage for his work. So, for the employee, working for wages is the same as exclusion from the property he creates. The employee is required to use his wages to support himself and is therefore an unsustainable form of property. He spends his earnings on the essentials he needs to live. At the end of the workweek, the employee is just as poor as at the beginning. Because the employee is employed for wages by the employer only to serve the increase of his property, the production sphere is not only where the employee is exploited in order to increase another’s property, but is also where the class division is produced and reproduced at the same time.

Thesis 4:
The poverty that property creates is useful and necessary

At 67, the employee gets social security. The employee works nearly his whole life in order to earn a few bucks to support a life, and nevertheless ends up dependent on social security. His dependence – because he is without property – forces him to do this and to increase somebody else’s property. His destitution is useful and necessary so that business makes profits and so that economic growth takes place.

The employee leaves the company just as devoid of means as he arrived, since the wealth produced by him belongs to someone else, and he is excluded from it.

Thesis 5:
Wages are not payment for work performed, but the means to extort work

The employment contract makes the worker’s ability to work available for a certain period of time for wages. Conditions, processes, types of work and levels of output – these are all solely the concern of the employer. On one side, as the employer buys the worker’s ability to work, he transfers property – money in the form of wages – into the hands of the worker; on the other, he acquires the source of producing property – the worker’s ability to work. The use of this source increases his property, and the workers’ efforts increase nothing but the property of the employer. The wages are not only payment for the work done. They also include terms for specific work achievements that the worker must meet in order to receive payment: by linking wages to time, effort or quality, their amount is made dependent on the requirements of the company being fulfilled.

Wages are paid as piece rates or hourly wages: the wage level is bound to the number of items produced or the time spent working. Only then does he employee receive the full wage level. He must be interested in his own exploitation – from which he only gets damaged.

Thesis 6:
Work in capitalism is subject to the comparison of two sums of money: wages and profits

Work as the source of wealth is subjected to the criteria of private business success: the work was useful only if it was a source of profit. Otherwise, the result is worthless. Work as a relationship of expenditure and yield is thereby measured according to a standard that originates nowhere near the work itself.

The actually expended labor – the time and effort of human beings – doesn't count as the expenditure of labor; only the payroll spent on the labor counts. So wage lowering reduces the cost for the employer and thereby increases the labor of his company.

The workers must pay for their work being measured by this standard: because if wages count as costs, then the living expenses of the workers – the wages – are a quantity which can be minimized. And if their output increases wealth, then the worker’s sweat is the quantity that can be maximized. Even if the worker’s sweat cannot guarantee profit, because the produced things must still win sales on the market against the competition, the work of the worker is deemed responsible for this success against the competition. So the labor of the workers must prove itself in this competition, even though the work in the form of the finished goods on the market – viewed objectively – has long been finished.

Thesis 7:
The requirement to compete is not an objective necessity of production itself, but an objective necessity of the interest of the entrepreneur

Businesses calculate their revenue and expenditure accounts with a profit they can only achieve on the market. They all refer to the market as the reason things get tough, because of the fierceness of the competition. Managerial policy is always aware of the objective requirements of competition. Whether the employers announce layoffs, eliminate Christmas bonuses or oppose work-free weekends, they do everything only because they are “forced by the competition.” Allegedly, even the entrepreneurs themselves are victims of the competition and, because of the competition, they need to cut their losses.

This ideological hypocrisy separates the goal of the entrepreneurs – the increase of their property – from its means: they achieve this goal “only on the market” because that is where the entrepreneur meets likeminded people. Thus the entrepreneur is not a victim but an agent of competition who, if he takes up its requirements, intensifies these requirements because he wants success just like the others.

The ideology that sees the entrepreneur as subject to enormous objective constraints acts as if business is not an interest, but a natural consequence of production. Public acceptance of this ideology of “objective necessities” shows that, in this society, this mode of production is considered the most natural thing in the world, and the entrepreneur’s point of view is the only one that is valid, to which everybody must adapt their own expectations.

Thesis 8:
Profit-making requires price reduction

In their calculations, businesses take market prices as their benchmark. Their profit consists in the difference between the market price and the cost price of a product, multiplied by the number of goods sold. Companies compete for a limited solvent demand and try to win market shares away from their competitors. In order to win sales for their products against their competitors, they must offer their products at a cheaper price. Over time, this pays off only if they lower their production costs. The constraints of competition manifest themselves in a price war: if one lowers the price, the others must follow suit in order to stay in business.

Thesis 9:
Price reduction means lowering wages

The means to lower production costs is rationalization. If the efficiency of the work rises as a result of new productive inputs, the wage portion of the production price of the commodity sinks. Making the work more efficient lowers the operational labor costs for the company.

The economic logic of this operational calculation knows only costs and their impact on profits: rationalization takes place only if the acquisition of a more efficient machine saves more on wages than the machine costs, relative to the product.

A machine is not used to increase productivity so that less toil is necessary for the production of a commodity, but to save on paid labor.

Thesis 10:
Increased labor productivity harms the workers

The use of the more productive machinery is decided by the owners. Its first productive application is laying off workers. But the company is not satisfied with that. New demands are made on the remaining workers, since the jobs that remain have become ever more expensive with the rationalization:

So whether one has the “bad luck” of being laid off or is “lucky” to still be employed, the increased efficiency of labor excludes the workers from an ever larger part of the wealth they create, simply because wages amount to a smaller portion of the value of the product.

Thesis 11:
Competitive success means saving on the source of wealth

Entrepreneurs fight for market shares to increase their profits. They wage this battle as a price war. In order to lower the manufacturing cost of their products, they increase productivity. By making the work more productive, they lower the wage portion per commodity.

Because of the price war on the market, the entrepreneurs think that their profit arises not from the labor they employ, but from saving on wages in the production of a certain mass of products; for the entrepreneurs, wages appear on their balance sheet as a pure deduction.

In order to retrieve a higher profit from their employees, they reduce the number of workers. In order to increase their property by appropriating from their employees as much work as possible, they reduce the work necessary for the production of a certain number of goods. Because all the entrepreneurs rationalize like crazy to survive the competition, this generally lowers the product’s price and thus what they can obtain for their product in money. In their competition for the purchasing power that realizes their surplus, they lower the surplus in relation to the investment, and thus their rate of profit. This paradox is the necessary result of a competition in which entrepreneurs fight over shares of the produced wealth at each other’s expense.

Only one adequate solution exists for this contradiction: the workers are made liable for the net yield of the company by extensions of work time, wage reductions, and more intense and productive work.

Thesis 12:
Credit is the entrepreneurs’ means of competition. Credit-worthiness is the highest goal of business

In their competition, entrepreneurs assess the prices of the competitors they want to overtake and undercut. This requires money to pay for the expenses of the rationalization necessary to reduce costs; it is not paid from the money that a company has from running its business. Businesses must overcome the limitations of their own property to successfully win the competition. They must borrow money.

If the means for rationalization are made available by credit, then competition forces everyone to economize with credit. Everyone who does not want to be punished with failure must find a backer who only lends money if it promises to pays off. Companies must prove themselves credit-worthy, i.e. offer their backers a sufficient guarantee that their money is well spent.

In order to obtain credit as a means to be competitive, a company must turn itself into the means of credit.

Thesis 13:
Credit is the pledging of profits still to be earned

Financial businesses pursue their business interest by lending money: they require interest as the price of lending money to a business for a certain time period. Their property, their exclusive power over money, is the only and sufficient reason for the fact that the money-lenders can require a tribute for loaning money.

Since the credit lender has a claim to get back the lent sum of money plus a fixed increase, he treats the business of the entrepreneur as if it has already succeeded. Furthermore: each credit lender treats his promissory note to future profitability as already existing, available wealth: banks treat the assigned credits on their books as assets which they can use to assign new credits; entrepreneurs treat the promises to pay of their buyers like money, who for their part pay, etc.

Promises to pay, money that still has to be paid back, debts, and loaned money are all treated like disposable money: for this reason, property doubles itself. Of course, only as long as loans are actually serviced, i.e. the entrepreneurs make sufficient amounts of profit. On this, both the loaner and the borrower are equally interested. They argue over the interest rate for their portions of future profits.

Property as credit is a claim to the fruits of future exploitation. Those who lend their money require interest; with the borrowed money, the others get the next round of competition.

Thesis 14:
Because credit requires that entrepreneurs follow their interest, it raises the demand for profitability to a higher level

Credit treats promises to pay as available funds. So the increase of money is anticipated in practice. That this actually works out is assumed to be a self-evident achievement of the labor which then must prove that the claim of the property to increase was valid.

Credit frees the interest in making a given amount of money into more money from all external limits. Money not yet earned from sales on the market becomes available for further accumulation. All business possibilities, judged as investments of funds, have to be placed in a comparison between how much net yield the investment promises and how high the “business risk” is. Thus companies are not only forced to produce a surplus, but to stand up to industry-wide profitability requirements at the highest level.

It is not within the power of labor to meet this requirement that is dumped on it. So labor is saved on in every way; it is constantly concentrated and used so exhaustively that it fulfills the requirements. And where it does not justify those claims, it is made completely superfluous.

Thesis 15:
In crises, claims on wealth are confronted with operative wealth

With credit freeing the accumulation of money from all external limits, companies are able to maximize output with their rationalization efforts.

They orient themselves solely by their debts, in which their future business success is calculated as a requirement. They allows them to ignore the barriers that the market, which is really the only place they can draw wealth, sets for them.

This periodically leads to the event that sales prospects and thus debt operations come to a general halt. If the entrepreneur cannot sell products any longer, the proceeds of which belong to the creditor, he needs more borrowed money in order to service his debts.

The granting of credit becomes ever riskier if large companies do not make profits in sufficient amounts to justify their credit. The banks must decide whether to write off the money they have lent so far by withdrawing credit, or to lend even more money, which is ever more uncertain of returning again. Because they persist in the equation that money loaned is genuine wealth, they intensify the criteria for credit-worthiness.

If confidence in the quality of debts lapses, the real course of business is confronted with the requirements of the creditors. They reclaim their money and companies go broke. Credit withdrawal in one place leads to an inability to pay in another place: shares get purged, payments are not covered, a bank collapses – this has consequences for the other banks and companies ... the crisis expands. Demands are made and wealth is destroyed until it the former condition is restored.

This “healthy” contraction happens at the expense of labor, whose final use consists in being deactivated. After a crisis, there is a gradual increase in the reserve army of labor. The maximum productivity of labor is the basis on which exploitation continues.

Thesis 16:
Clarifications about the ideology of GLOBALIZATION

In the ideology of educated people, we live in a time in which the world market subjects the states and the corporations to international comparisons. The buzzword “globalization” has made this opinion common knowledge.

a) Globalization: “we are compared!” – the construction of an false necessity.
Anyone who talks about “globalization” talks as if the requirement to be internationally compared is “simply so.” The “globalization” ideologists maintain the absurdity of a comparison with no interest behind it. If all states see themselves subjected to this comparison, the question arises: how else does the obligation to compete come into the world other than by the fact that the states want to use the international market and therefore undergo comparison on the world market? The requirement to compete exists only in relation to the interest in taking part in the competition.
The keyword “globalization” suppresses the fact that the states of the world only enter into comparison on the world market because they want to make use of it for themselves. The interest in the world market appears as a necessity. Thus the state is said to be the victim that is suffering from comparisons!

b) Globalization is commitment to the world market.
Following the diagnosis of this unpleasant compulsion, nobody then advises that it would be better to quit. Few states want to leave the world market. “One can no longer remove oneself from it,” it is said, and in the same breath it is said that world market competition is an external constraint on the state which it does not actually want. Commitment to the world market could not be any more unconditional than when it is explained as a fate that is now imposed by a “globalized world.”

c) Globalization is the need to enrich oneself at the cost of others on the world market. If politicians talk about “globalization,” they do not want to passively watch the world market, but “face the new challenges,” as modern state leaders justify acting responsibly. With this weak explanation, they commnad themselves to agressively decide the comparison on the world market, i.e. to emerge from the competition against all the others as the winner.

d) Globalization is a declaration of class warfare from above.
The state uses its sovereign force appropriately. Its “location” should be an unbeatable offer to the businessmen of the world. It intentionally comes to the finding that wages are too high. Those who must live on them are informed: “you have lived beyond your means,” in order to pull through an austerity program which lowers the standard of living of the wage earning population across the board.

This demonstrates that the wealth that the states compete for on the world market is based on the poverty of the masses.

Thesis 17:
The state draws the real means of its power from successful capitalistic exploitation of work

Domestically, the state compells everyone under its rule to use money as the only way to get by. This is how it informs the citizens about their class-specific service for property. This is how it ensures the national accumulation to which it helps itself for its part in creating the surplus.

Abroad, in the name of economic growth, the state sits down with foreign powers to create relations which allow its entrepreneurs to access foreign sources of wealth. Thus labor has to be put to the test of an international comparison of wages and output at commodity prices suitable for the world market. The exploitation standard reached by each nation becomes the criterion for investment decisions and also the objective necessity for globally cheapening the cost factor labor.

Thesis 18:
In transnational trade, the state orders its entrepreneurs to gain money surpluses for the nation on the world market

Inside the nation, legal tender circulates whose validity the state guarantees by force. In order to make foreign trade possible for its entrepreneurs, the state must provide for the international validity of its currency by guaranteeing its exchangeability against any other currency. But it needs a public treasury with reserves of foreign exchange and/or precious metals. Thus the ability of each state to make use of the world market possible for its entrepreneurs depends on obtaining a national surplus in international trade. In contrast to its businessmen, who import or export, buy or sell when it is profitable, the state must arrive at a positive balance of payments. The fact that a state exports more than it imports is equivalent to the fact that somewhere else this ratio happens the other way around. The success of one nation is thus necessarily the failure of the other.

Thesis 19:
The mutual crediting of states restricts the world market

Nowadays, the nations which always end up the losers in international trade, which not long ago would have had to abandon international trade because of national bankruptcy, no longer do so because states no longer insist on payment of the deficient balances. The states mutually grant each other credit. It is crucial for the world market that the debtor nations do not fail as buyers, and their entrepreneurs make international business possible for successful states without consideration for their own public treasuries.

Because state bankruptcies are now impossible, the criterion for national success has changed. The power of a nation to access foreign wealth depends on the stability of its currency, which depends on the demand for it.

Thesis 20:
National success exists in a stable currency

The determination of the rate of exchange is left to the financial markets. The demand for a currency depends on the extent to which it works satisfactorily as a means of business. By this criterion, useless local money is separated from good money. Currencies which supply goods on the basis of effective demand are promoted to reserve currencies, real world money: their attractiveness depends not on fluctuations in the course of business, but in being considered all over the world as a means of storing value. A currency that is a means of storing value offers universal access to the wealth of the whole world. Because it is universally accepted, such states can incur debts for themselves for an unlimited period.

Since a rate of exchange is the relationship of currencies to each other, the success of one nation is equal to the failure of another.

Thesis 21:
The means of currency competition is location competition

As soon as states worry about the worldwide success of their currencies, they try to attract world market-suited capital to their territory, because only this guarantees that the global players demand their currency.

The money patriotism of modern states therefore makes only one demand on the capital on its own territory: it has to out-compete the foreign competition and to answer the question: which money stimulates international demand in its national interest?

The national interest is no longer to make business possible abroad for its national entrepreneurs, but to get world market profiteers on its territory. In addition, incentives for investment are offered to the multinationals, which are national companies adapted to the world market.

Thesis 22:
Wage lowering is the means of location competition

The wage level is in principle a location disadvantage everywhere; in wealth production, it is a cost factor which the state attempts to cut.

For the state, the location competition over lower wages is an advantage in still another regard: saving on wages does not hurt accumulation. Just the opposite: in contrast to the establishment of all the other conditions for accumulation, wage lowering does not cost the state a penny.

With a universal lowering of wages, the state demonstrates in practice the judgment that wage dependence is the negative condition of wealth. The standard of living of those who live on wages is not a contribution to the growth that the state is interested in, but is seen as only a detraction from it.